8 Essential Elements of an Unbeatable Freelance Contract + a Free Template
In the world of the gainfully self-employed, the freelancer (or independent contractor) is a lone wolf.
It’s especially important for freelance writers (or photographers, web designers etc.) to write a freelance contract between himself and a new client that will spell out the essential elements for things like payment terms or time frames.
Many freelancers fly without a safety net in this department, choosing to rely upon email or verbal agreements without always closing loopholes and defining the gray areas within gigs. Although some common standards may seem self-explanatory, more often than not, it’s important to spell things out.
However, without a contract that clearly states all the details of a working relationship in print, there’s too much room for error, surprise, and at worst, an expensive lawsuit.
Contracts protect freelancers and freelance work and also provide flexibility for the unforeseen. They reduce the room for interpretation between potential client and freelancer, and put clients at ease. Beware if you decide to work with any client that’s hesitant to sign a contract with you, this behavior is typically indicative of a hidden agenda.
Here are 8 ways to write an unbeatable freelance contract that avoids surprises and keeps you flexible.
1. Get Specific and Thorough.
Just as important as the service you’ll provide, it’s crucial to define elements of service you will not provide, especially if there’s room for gray area. For example, when I write a contract for freelance developmental editing, a structural edit that addresses content, not copy, I make clear that this agreement does not constitute a copy-edit, and therefore I can’t be held responsible for copy-edit errors.
This addendum to my original contract came about the hard way—after a client insisted, after completion of services, that they had wanted a copy-edit, despite the fact that we had not agreed to that service. Rather than burn that client relationship, I did further editing, took a loss, and learned my lesson. This is another reason why you should be very clear and upfront with your clients in the contract terms, so you agree on performing only the activities you want to complete (for the agreed upon price).
Many clients will also request a nondisclosure agreement to protect client interests so that you won’t disclose any of their sensitive or confidential information.
2. Choose Your Payment Rates.
There are two main ways to charge clients, and there will always be endless debate about which one is best for your business. The short answer: you need to decide for yourself, based on your own unique needs as a freelancer.
The first way to bill clients is known as “fixed price”—where you simply set a project fee, based on whatever variables work for your service (number of pages x a per page rate; number of photographs provided in x time; a specific product for a set dollar amount) which is essentially an estimate of hours you think a project will take. Example: “Rate is $50/hour, not to exceed 20 hours.” or “Project is estimated to fall between $1500-$2000, but not over.” This can provide a sense of relief to the client, but sometimes a fixed price can cause you to lose money should the project require more hours than you’ve estimated.
The other way to charge clients for your services is by “time and materials” or “hourly” which leaves room to charge for every hour you spend working. But even in that method, clients usually want an anticipated parameter so they can work within a budget. Ultimately, your business model and financial needs will dictate the best method for you and regardless, be sure you’re charging what you’re worth (and not undervaluing your hard work and experience). Be sure to outline a specific payment schedule as well to ensure you receive final payment in a timely matter. Outline acceptable payment methods, too.
3. Additional Work (Scope Creep).
Hopefully you’ve gotten specific enough about what you are (and are not) providing by this point. Yet, sometimes, there’s still another service your client may wish to obtain, and in many cases, it’s one they aren’t aware they need to pay extra for. This is called scope creep, when clients, whether knowingly or unknowingly add work to your project without reassessing the payment amount.
Your time is money. If an editing client also wants help finding an agent or researching publishers, this would fall under my “consulting” clause, and is billable over and above our contract fee at my hourly rate. While it’s up to you how much “extra,” or free work you wish to do, it’s helpful to remind clients within the contract that you will bill for time spent or services performed outside the boundaries of the original project at hand.
You might even have a rate sheet for other services to attach, or simply be sure that you’ve included the language that any further work performed outside the boundaries of the project are to be billed at an additional rate.
4. Timeline or Turnaround.
Here, it’s very important to know yourself and your working rhythms.
Can you provide a hard and fast deadline that you’ll make no matter what? Do you need to allow in an extra day or week for the vast array of things that can go wrong, from software failures to sick days? Since freelancers rely heavily on word of mouth from clients, it’s important to be good to your word when it comes to delivery.
I often work in a clause that says, “Should freelancer expect to run late, she will inform client by email.” Check out these extra tips on how to get better at meeting client deadlines, and make sure you have a serious time management system in place that matches your working style.
5. Customer Notes.
You can save yourself longwinded conversations in which customers give you a dissertation about what they hope and expect for the project by providing a simple, short “notes and comments” section in your contract. “Please state any specific needs or concerns the contractor should be aware of in these five lines.”
If your project is one that will require client interaction along the way, set limits. “Contractor will provide two 30-minute phone sessions as part of project fee. Further phone consultations will be billed at X/$ per hour.”
6. A Termination Clause.
Sometimes, due to forces of nature, fickle feelings, and a host of other unforeseen circumstances, you or the client (or both) may wish to discontinue services before the contractual period is over.
Check out Justin Barker’s experience with a freelance client breaching contract, and you’ll understand why it’s important to have a contract that clearly stipulates termination terms. Leave room in the contract to give both of you an out that doesn’t cost more money than is already agreed upon. In the contract, you may say, “Should client and contractor choose to discontinue work, only X pages, hours worked, or photographs developed” will be pro-rated and billed, and any over-payments refunded.”
7. Deposits and Retainers.
The best legal advice I can offer is don’t work for free.
Even if you are able to allow a client to make payments over time, always insist upon a deposit or a retainer before you begin. And don’t be afraid to ask for full payment up front, if that works better for you. You’re not a credit card company; you’re a person paying real bills.
Some freelancers will work only up to the end of the client’s deposit, and then require the next installment to proceed. You may also choose to get half up front and the rest upon completion. The key is to be specific. Don’t keep it vague.
8. Terms for Late Payments.
The freelancers I know are all nice people who like to give their clients the benefit of the doubt.
But you can’t pay your bills with faith in people. There’s nothing to throw a wrench in your ability to stay solvent than a client who can’t pay you on time, or, at worst, breaches your contract. You have the right to charge interest or fees on late payments, so long as you put this information into the contract. If a client signs the contract that states they’ll pay a 10% late fee when a payment is late, then you now have legal recourse. Hopefully, the very existence of this clause in your contract will be enough to stop your clients from this bad behavior.
Ultimately, if you encounter a situation more than a few times in your business that you can see a way to avoid by writing in a new clause, do so. You’ll save yourself hassles at best, and you’ll learn a thing or two about what to do better next time, at worst. For more on what it takes to run a freelance business, check out Becoming a Successful Freelancer right here on CreativeLive.
Need a real-life freelance contract template that you can use in your own business? Download our free template, right here.
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